Stocks in London jumped on Wednesday morning as a surprise pick-up in Chinese growth and a drop in UK unemployment brightened the outlook for the global economy.

The internationally flavoured FTSE 100 was up 0.9% at 6,772 by around midday; it has not closed above this level since July 7th.

Chinese gross domestic product (GDP) grew at an annual rate of 7.5% in the second quarter of 2014, surprising analysts who had expected growth to remain unchanged from 7.4% in the first quarter.

Other data from China also showed that fixed asset investment and industrial production both came in above analysts' estimates in June, while retail sales growth of 12.1% was unchanged, slightly lower than expected.

The UK unemployment rate fell from 6.6% to 6.5% in the three months to May, its lowest rate since 2008 and two years before Bank of England Governor Mark Carney had targeted this level. However at the same time, pay growth lagged inflation, which economists believe may ease the pressure on Carney's Monetary Policy Committee to raise interest rates in coming months.

Analyst Simon French from Panmure Gordon said that with wage growth still at "anaemic levels", rate will likely remain on hold until early 2015. "Our view is that continuing unemployment and underemployment in the UK labour market, as well as broader deflationary factors, will dampen any increases in wage and price growth over the next 12 months," he said.

Comments from Janet Yellen will continue to be analysed today after the Federal Reserve Chair hinted yesterday the central bank could hike interest rates sooner than the markets current expect if labour-market data continues to surprise to the upside. However, she said the recovery is not yet complete and that monetary stimulus is still required.

Following yesterday's Senate Banking Committee hearing, Yellen will continue to be closely watched today as she speaks to the House Committee.

Meggitt jumps on M&A hopes

Aircraft parts group Meggitt saw shares surge on reports that the company could attract a US bidder such as United Technologies. According to market chatter, speculation has emanated from the Farnborough Air Show this week.

Mining giant Rio Tinto impressed with a "very strong first half" with productivity gains across the business, particularly its large iron ore division which registered record shipments, production and rail volumes.

The wider mining sector was mostly higher as investors welcomed the upbeat data from China, though shares in precious metals miner Fresnillo fell after the company said that silver production was flat year-on-year in the second quarter.

British Land rose after it reported a good start to the year as it continues to make the most of strong markets, with the occupational and investment markets in London and retail both strengthening.

Airline easyJet was also making decent gains ahead of its third-quarter statement on July 24th. Numis Securities analysts said they expect a "relatively reassuring" update from the group after industry concerns have pushed the stock sharply lower in recent months.

Postal group Royal Mail slipped on the news that it is facing a potentially "material" impact from a competition investigation in France.

Sports Direct edged higher after its founder Mike Ashley told the board of the sportswear chain that he will withdraw his name from its controversial bonus scheme.

Retail stocks were performing well after the upbeat UK data, including SuperGroup, N Brown, Home Retail and Next. N Brown was given a boost by UBS which raised its rating for the retailer from 'neutral' to 'buy', saying that the business offers "online growth at a high street price".

Self-storage firm Big Yellow gained after saying it delivered a "solid trading performance" in its fiscal first quarter with both occupancy and rental yields increasing.

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